Key Concpepts: The Definition of Economics, The Economic Approach

eLuxury.com

Go to the "Gift Finder" category at the top of the screen and select "Over $2500" value in the "Price Range" box. Click on "GO" to review the featured gift items.

• Would any "rational" individual with "unlimited wants" refuse a gift of this kind? Why not?
• What prevents you from having this watch or that necklace?
• Is there a conflict over "scarcity"? How would you resolve this conflict?

Appendix to Chapter 1

Working with Graphs

U.S. Census Annual Demographic Survey

Scroll down the web page and review the "Both Sexes All Races Total Work Experience—Mean Earnings" table data.

• Why is the assumption of Ceteris Paribus important when making a prediction of income based on a level of education?
• What additional information do you need to make accurate income predictions? What other factors should be considered? How would you model this study?
• Utilize the income and education data from the U.S. Census to develop a simple graph to illustrate the relationship (positive or negative) between the variables.